Compound Interest Calculator
See how your money grows over time with the power of compound interest and consistent contributions.
Investment Details
After 20 Years
Final Balance
$144,572.72
Total Contributed
$58,000.00
Interest Earned
$86,572.72
| Year | Total Contributed | Interest Earned | Balance |
|---|---|---|---|
| Year 0 | $10,000.00 | $0.00 | $10,000.00 |
| Year 5 | $22,000.00 | $6,494.83 | $28,494.83 |
| Year 10 | $34,000.00 | $20,713.58 | $54,713.58 |
| Year 15 | $46,000.00 | $45,881.93 | $91,881.93 |
| Year 20 | $58,000.00 | $86,572.72 | $144,572.72 |
Frequently Asked Questions
What is compound interest?
Compound interest is interest calculated on both your initial principal and the accumulated interest from previous periods. Unlike simple interest (which only earns on the principal), compound interest causes your balance to grow exponentially over time.
How does compounding frequency affect growth?
More frequent compounding means slightly faster growth. Daily compounding earns marginally more than monthly, which earns more than annually. The difference is small compared to the impact of your interest rate and time horizon.
What is the Rule of 72?
Divide 72 by your annual interest rate to estimate how many years it takes to double your money. At 7%, your money doubles in about 10 years (72 ÷ 7 = 10.3). At 10%, it doubles in about 7.2 years.
Why does starting early matter so much?
Time is the most powerful variable in compound growth. $10,000 invested at 7% for 40 years grows to ~$150,000. The same amount invested for only 20 years grows to ~$39,000. Starting 20 years earlier produces nearly 4x the result.